A Review of Banking Fees in Canada (the Review), released today by the Financial Consumer Agency of Canada (FCAC), found that the way some banking fees are structured can make costs harder to understand and compare, with implications for affordability and competition.
The Review highlights several ways banking fees can be difficult for consumers to see or anticipate:
- Multiple fees can apply to a single transaction, increasing its total cost.
- Foreign exchange and cross-border debit fees can be embedded in the cost of a transaction, making the amount consumers pay in fees less visible.
- Usage-based fees can make costs difficult to predict, particularly when consumers have difficulty tracking how many transactions they have made.
Individually, these fees may appear relatively small, but the Review found that they can add up over time. Without a clear picture of the fees they are paying based on their actual usage, consumers may find it harder to assess the total cost of banking.
The Review identified opportunities to improve fee transparency and provide more personalized information about fees paid over time. This would make it easier for consumers to compare products and services.
FCAC's findings provide evidence to inform broader policy discussions on transparency, comparability, switching and competition, including the potential benefits of consumer-driven banking.
